Ringcentral (NYSE:RNG) and Donnelley Financial Solutions (NYSE:DFIN) Head-To-Head Review

Ringcentral (NYSE:RNG) and Donnelley Financial Solutions (NYSE:DFIN) are both computer and technology companies, but which is the better investment? We will compare the two companies based on the strength of their earnings, valuation, institutional ownership, risk, profitability, analyst recommendations and dividends.

Institutional & Insider Ownership

98.6% of Ringcentral shares are held by institutional investors. Comparatively, 93.8% of Donnelley Financial Solutions shares are held by institutional investors. 7.0% of Ringcentral shares are held by insiders. Comparatively, 11.9% of Donnelley Financial Solutions shares are held by insiders. Strong institutional ownership is an indication that large money managers, hedge funds and endowments believe a company is poised for long-term growth.

Profitability

This table compares Ringcentral and Donnelley Financial Solutions’ net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Ringcentral	-1.65%	-15.63%	4.79%
Donnelley Financial Solutions	11.56%	21.80%	11.10%

Valuation and Earnings

This table compares Ringcentral and Donnelley Financial Solutions”s top-line revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Ringcentral	$2.43 billion	0.99	-$58.29 million	($0.44)	-60.44
Donnelley Financial Solutions	$781.90 million	2.24	$92.40 million	$3.02	21.02

Donnelley Financial Solutions has lower revenue, but higher earnings than Ringcentral. Ringcentral is trading at a lower price-to-earnings ratio than Donnelley Financial Solutions, indicating that it is currently the more affordable of the two stocks.

Risk & Volatility

Ringcentral has a beta of 1.29, indicating that its stock price is 29% more volatile than the S&P 500. Comparatively, Donnelley Financial Solutions has a beta of 1.06, indicating that its stock price is 6% more volatile than the S&P 500.

Analyst Recommendations

This is a summary of current ratings and target prices for Ringcentral and Donnelley Financial Solutions, as provided by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Ringcentral	1	8	5	0	2.29
Donnelley Financial Solutions	0	0	3	0	3.00

Ringcentral presently has a consensus target price of $33.08, suggesting a potential upside of 24.37%. Donnelley Financial Solutions has a consensus target price of $71.33, suggesting a potential upside of 12.38%. Given Ringcentral’s higher possible upside, equities research analysts clearly believe Ringcentral is more favorable than Donnelley Financial Solutions.

Summary

Donnelley Financial Solutions beats Ringcentral on 9 of the 14 factors compared between the two stocks.

About Ringcentral

RingCentral, Inc., together with its subsidiaries, provides cloud communications, video meetings, collaboration, and contact center software-as-a-service solutions worldwide. The company’s products include RingCentral Message Video Phone that provides a unified experience for communication and collaboration across multiple modes, including HD voice, video, SMS, messaging and collaboration, conferencing, online meetings, and fax; RingCentral Contact Center, a collaborative contact center solution that delivers AI-powered omnichannel and workforce engagement solutions with integrated RingCentral MVP; and RingCX, an AI-powered contact center that a native delivers omnichannel experience. It provides RingCentral Video, a video meeting service that includes the company’s RCV video and team messaging capabilities; offers video and audio conferencing, team messaging, file sharing, contact, task, and calendar management, as well as pre-meeting, in-meeting, and post-meeting capabilities. In addition, the company offers RingCentral Professional Services, which include consultation, UCaaS and CCaaS implementation, VoIP phone system adoption, configuring custom workflows, customer and user onboarding, ongoing support, advanced support, managed services, and more. It serves a range of industries, including financial services, education, healthcare, legal services, real estate, retail, technology, insurance, construction, hospitality, state and local government, and others. It sells its products to enterprise customers, as well as small and medium-sized businesses through resellers and distributors, partners, and global service providers. RingCentral, Inc. was incorporated in 1999 and is headquartered in Belmont, California.

About Donnelley Financial Solutions

Donnelley Financial Solutions, Inc. provides innovative software and technology-enabled financial regulatory and compliance solutions in the United States, Asia, Europe, Canada, and internationally. It operates through four segments: Capital Markets Software Solutions (CM-SS); Capital Markets Compliance and Communications Management (CM-CCM); Investment Companies Software Solutions (IC-SS); and Investment Companies Compliance and Communications Management (IC-CCM). The CM-SS segment provides Venue and ActiveDisclosure solutions to public and private companies to manage public and private transactional and compliance processes; collaborate; and tag, validate, and file SEC documents. The CM-CCM segment offers tech-enabled services and print and distribution solutions to public and private companies for deal solutions and SEC compliance requirements. The IC-SS segment provides clients with the Arc Suite platform that contains a comprehensive suite of cloud-based solutions, including ArcDigital, ArcReporting, ArcPro, and ArcRegulatory, as well as services that enable storage and management of compliance and regulatory information in a self-service and central repository for accessing, assembling, editing, translating, rendering, and submitting documents to regulators and investors. The IC-CCM segment offers tech-enabled solutions for creating, filing and distributing regulatory communications, and solutions for investor communications, as well as XBRL and iXBRL-formatted filings pursuant for Investment Company Act through the SEC’s EDGAR system. This segment also provides turnkey proxy services, including discovery, planning and implementation, print and mail management, solicitation, tabulation services, stockholder meeting review, and expert support. Donnelley Financial Solutions, Inc. was founded in 1983 and is headquartered in Chicago, Illinois.